Centralizing Success

Joint ventures develop through the shared aspirations and mutual trust of two entities. When Prodelsa and Protelec — two family businesses with more than 70 years of combined experience — merged in 2007, the joint effort was christened Prodelec (Productos Eléctricos, S.L.) and became one of the leading electric material distributors in the Barcelona province, supplying the region with cable, fuses, load centers, circuit breakers, conduits and other such products. That same year, the company moved its headquarters to a 26,900 square foot facility in Mollet del Vallès, some 15 miles outside ofBarcelona. The merger also represented an expansion of sales locations and delivery routes, increasing the demand for home improvements solutions. In addition, the company expanded its portfolio, incorporating into itsBarcelonadistribution line materials for plumbing, HVAC systems, lighting and home appliances. Upon branching out, Prodelec realized it needed to enact a streamlined distribution operation that could efficiently service its clients, prompting the decision to create a centralized warehouse able to dispense product orders and deliveries. The company quickly found Mecalux and its acclaimed reputation for enhancing warehouse operations. For Prodelec, Mecalux turned out to be the best companion a successful venture could have: a company with storied excellence in providing optimal intralogistical solutions.

According to Óscar Cantaré, managing director for Prodelec, the critical necessity was to integrate the wide range of home installation materials and maximize the warehouse area, since they would be incorporating the stock from other Prodelec sales locations. “We had a business model in which each one of our sales locations had its own stock, its own transportation,” Cantaré said. “We opted to centralize transportation.” The challenge, therefore, was to consolidate operations from four independently functioning locations into the central warehouse in Mollet del Vallès. Starting in November 2009 and ending in May 2010, the company sought the services of Mecalux to help them provide a solution to their constantly rotating stock of 8,000 SKUs, while also consolidating the entirety of their operations from the other sales outlets. “Centralizing our entire transportation meant processing 100 percent of our clients’ orders out of Mollet,” Cantaré remarked, “which meant increasing the number of SKUs and the number of order picking processes, and that’s when we saw that we needed to automate a part of all that process.” The company’s adoption of a hub-and-spoke distribution model meant establishing the Mollet del Vallès warehouse as a central hub from which it would radiate route structures (spokes) throughout theBarcelonametropolitan area. Within this model, EasyWMS became the innovative instrument that helped expedite order prep for shipping from Mollet del Vallès, moreover streamlining delivery schedules and routes. This in turn resulted in reducing its branch warehouse storage areas by half.

The warehouse in Mollet del Vallès is divided into different sections, each one storing specific kinds of electrical, plumbing, HVAC and lighting materials. Warehouse operations are carried out by six radiofrequency terminals each fitted with three antennas. With the aid of EasyWMS, individual tag codes containing logistical information are assigned to each SKU housed in the database server. From there, the client planning database (the Enterprise Resource Planning server) automatically inherits the receiving operations. EasyWMS registers this information and translates it into picking orders. The picking order display list will appear on the radiofrequency handset terminals, which provides warehouse operators with information about a product (its lot, aisle, position, height, etc.) in which the SKU is stored. Once the product has been located, it is brought to a location where it is prepared and grouped for shipping. Shipping labels and packing slips are created, containing unique SKU barcodes, which will update the stock and engage order tracking prior to departure. Implementing EasyWMS into Prodelec’s operations reduced order preparation areas from six terminals to three, and increased the order picking capacity by 30 percent.

Considering that the primary activity of Prodelec is delivering material to its clients, creating an efficient operation to carry this out has been its main objective. At present, Prodelec has 12 routes in theBarcelonametro area, a number it has maintained despite reducing the number of its vehicles by two. EasyWMS enabled the same frequency rate and load level of delivery by providing a combination of more efficient order and shipping preparations, as well as more logical routes and schedules. This increase in productivity has allowed Prodelec to exercise greater control over inbound stock items destined for storage, even when cross docking is required. EasyWMS can distribute received items, sort, consolidate and ship them to compensate for a greater influx of material that will require rapid shipping without using valuable storage areas. This evasive measure counters an increase in demand that could deplete stock levels and disrupt the supply chain. This allows for the same transportation resources to carry out their deliveries, despite the increase in shipment amounts.

Although the bulk of Prodelec’s business is its material delivery and transportation services, the company also provides home improvement solutions through a direct retail service to clients. The adaptation of a centralized distribution model allowed the remainder of the sales outlets to shift their focus more on the company’s retail business. “Since they only provide counter service, their stock levels decrease drastically,” Cantaré said. This reconfiguration resulted in a stock reduction of 40 percent at all other branch locations, while the warehouse in Mollet del Vallès increased its stock levels. “One of the consequences [of a centralized model],” Cantaré said, “is that you’ll end up with a greater stock.” The Mollet del Vallès location now handles 8,000 active SKUs, supplying each satellite with a limited stock of picking materials. By allowing the other locations to continue thriving as retail outlets, the company has retained its character as a provider of personalized solutions, communicating face-to-face with its clients while still reaching out to customers with large-scale needs.

Prodelec has set its sights on the future by strengthening its technical installation and consulting services. Within the electrical material industry, Prodelec provides energy efficiency and cost-saving consultations to its clients, as well as the materials that help them optimize their energy solutions. The challenge of establishing itself as a one-stop shop is already underway since the company has adopted this hub-and-spoke distribution model, a move that would not have been possible without Mecalux at its side. “Mecalux from the beginning […] considered the Prodelec project as its own,“ Cantaré said. “They got involved from day one, first by understanding our problem, our unique needs, and addressing them to the fullest extent. The [software] program has allowed us to work in a specific way; they didn’t impose the model that EasyWMS proposed and were with us from the get-go.” For Mecalux, lending a helping hand also means understanding its clients’ history and business. By gaining insight into what makes its client successful, so too has Mecalux come to understand its own success.